Yes, the SG4 states (Terengganu, Kelantan, Kedah, and Perlis) can absolutely benefit financially from their Rare Earth Element (REE) reserves.
The SG4 sits on an estimated 70% of Malaysia's total REE resources.
Estimates presented by the SG4 value the deposits in just three of its states (Terengganu, Kelantan, and Kedah) at approximately RM568.10 billion.
Whether they achieve massive wealth or get trapped in low-value raw extraction depends entirely on navigating a federal-state political tug-of-war and the availability of technical capability.
The Federal government, as part of its national resource strategy, strictly restricts the export of raw, unprocessed REEs as it wants to transform the country into a high-value domestic processing hub.
The SG4 leadership has explicitly stated they want to avoid repeating the "mistakes of the past," referencing oil royalty disputes where resources were extracted without building local wealth.
The SG4 leadership has emphasized moving beyond the raw extraction and direct export of minerals. Instead, they aim to develop a localized, comprehensive industrial ecosystem featuring advanced manufacturing, separation plants, and high-value downstream refining.
While the SG4 states have the legal right and raw materials to extract REE, under the Federal Constitution, the federal government controls export licenses, environmental regulations, and national industrial policies.
In summary, the SG4 states have the physical lottery ticket (70% of the country's wealth).
But they can only cash it if they successfully resolve their policy friction with the federal government to let international investments flow smoothly.
Already, at the SG4 Business and Economic Forum, the Kedah Menteri Besar accused the Federal government of using "national security" concerns as a stall tactic to block opposition-led states from commercialising their rare earth element (REE) deposits.
Raising and attracting massive international capital to build multi-million dollar chemical separation and cracking plants directly inside their borders should be the least of the issues as a mix of global processing giants, Western advanced technology firms, and regional automotive component suppliers have expressed interests or are in active discussions with the SG4 governments.
Why and reasons for the active expression of interests?
The REEs found in Malaysia are largely ion-adsorption clay deposits which apparently are highly sought after because it contains heavy rare earths used in EV magnets and advanced weapons.
And Western nations are desperate to find REE supply chains outside of China.
Development of a midstream and downstream economic activities in the SG4?
Did the country benefitted tehnologically from the entry of Lynas Rare Earths in 2012 into Malaysia?
Reportedly yes, it transformed Malaysia into the world's largest rare earth element (REE) refining hub outside of China.
Over 90% of the plant's workforce - Lynas has contributed to the creation of over 4,600 direct and indirect jobs for locals in Malaysia, with the vast majority classified as highly skilled or semi-skilled - consists of skilled local Malaysian engineers and technicians who have mastered complex recovery, extraction and process automation.
The SG4 states have the physical lottery ticket (70% of the country's wealth).
But they can only cash it if they successfully resolve their policy friction with the federal government.
If PAS, who governs the SG4 states, is successful and gets to occupy Putrajaya in the 16th GE, this issue is academic.
FLK (leekhean.foo@gmail.com) is a content creator under the Newswav Creator programme, where you get to express yourself, be a citizen journalist, and at the same time monetize your content & reach millions of users on Newswav. Log in to creator.newswav.com and become a Newswav Creator now!
The User Content (as defined on Newswav Terms of Use) above including the views expressed and media (pictures, videos, citations etc) were submitted & posted by the author. Newswav is solely an aggregation platform that hosts the User Content. If you have any questions about the content, copyright or other issues of the work, please contact creator@newswav.com.
